Apprenticeship levy needs more than devolution, argues HR

Despite new calls to hand local UK councils greater powers over apprenticeship levy funding, HR experts have said that a focus on improving criticised areas of the levy should not fall off the agenda.

As reported by the Financial Times, The County Councils Network has called on the government to give local areas devolved oversight over apprenticeship levy funding.

This, the network argues, is to rectify issues that have led to a decline in the numbers taking on apprenticeship learning.

The levy was introduced in 2017 and funded via a toll on employers with a wage bill of £3 million.

It was intended by government to attract 600,000 new apprenticeship starts a year but the average has been nearer 330,000.

As previously reported by HR magazine, the levy is regularly criticised for being inflexible, too difficult to use, overly bureaucratic and narrow in scope.

Read more: Billions in unused apprenticeship levy funds returned to the Treasury

Speaking to the Financial Times, Alison Wolf, cross-bench peer and educational expert, said devolving levy powers to local government would increase uptakes of apprenticeship funding by small businesses.

She said: “We need to build a network of local authorities and local colleges to encourage and help businesses to use the apprenticeship scheme.”

However Alexia Pedersen, VP of EMEA at O’Reilly, said though control of apprenticeship funding by local councils could bring about the flexibility employers need from the levy this should not be at the detriment of making apprenticeship training more readily available.

Speaking to HR magazine, she said: “Remove the barriers to entry and modernise the approach with flexibility so the numbers can grow year after year.

“A traditional structured approach to learning is valid, but we also need to encourage a non-structured approach with the opportunity to learn in the flow of work.”

Kirsty Barden, head of business development at Management Development Services, said focus on the lack of flexibility, barriers to entry and a mismatch between what businesses need and what levy funding can be used for are important problems that need solving first.

Speaking to HR magazine, she said: “The decline in participation is alarming and demands immediate attention.

“And while the numbers are dwindling, the focus often remains on hitting targets rather than ensuring the quality and relevance of the apprenticeships and traditional apprenticeship programmes often tie individuals to one role, reducing their scope to discover their best-fit career path.”

Kate Palmer, HR advice and consultancy director at Peninsula, said uptake levels of apprenticeships will always be linked to whether an employer considers them useful, regardless of devolution.

To fix the levy, she argued a consideration of how useful the apprenticeship scheme is to employees will be crucial.

In addition, she added there needs to be a review of whether there is too much bureaucracy involved in hiring an apprentice and if employee support is adequate.

Speaking to HR magazine, she said: “Employers will need to be supported and guided more to encourage increased numbers of businesses to offer apprenticeships in their workplace as the two elements are interlinked and reliant on each other for apprenticeships to be more effective.

“And any steps that can aid businesses and cut bureaucracy may encourage them to offer apprenticeships in their organisation.”